Stock plunge threatens state budget Davis spending plan assumes market, economy will recover

SF Chronicle ^ | 7/27/02 | Lynda Gledhill, Chronicle Sacramento Bureau

[randita]

Sacramento -- Wall Street's summer meltdown could threaten a key assumption in Gov. Gray Davis' plan to close a $23.6 billion budget deficit: that economic recovery is just around the corner.

Some experts predict that even if Davis and lawmakers manage to patch together a budget this summer, steeper tax increases and deeper spending cuts will be needed to deal with future budget deficits.

[randita]

"Clearly I would like to see the market improve from where it is today," Davis said in an interview with The Chronicle this week. "The better it does, the more wealth people have and the more revenue there is for the state. I guess you can also say the opposite is true."

This quote belongs in the archives of statements which identify liberals as liberals.

CalPERS is sitting on a stash of $145 billion. Wonder how long before Gray Out dips into that pot.

[randita]

ping

[willyone]

Gray out needs to start getting rid of all the excess people hired during the boom years when every cent was spent like the good times would never end. Not a thought to saving or finishing projects before starting new ones. When they start stealing from CalPers the poop will hit the fan.

[Ernest_at_the_Beach]

They are all set for stealing from the pension funds.

Hell, Willie Brown sits on the board!

calgov2002:

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[Carry_Okie]

Before Davis could assume that a market economy could save him, California would have to have one.

Davis is busy killing it.

[John Jorsett]

The reluctance of Davis to act in the face of unpleasant circumstances is what got us into the electrical power situation and the budget shortfall to begin with. He's staying true to type, and we're headed for an even bigger mess. The state's hostility to business and industry is going to hurt job creation even when an economic recovery is well underway elsewhere. The Davis giveaway to public employee unions (employees will be able to retire after 30 years with 90% of their pay, up from 60%) is just starting to bite: local governments are on notice that they're going to have to kick in increasing amounts to fund public employee retirements. And just wait until the state bond rating is downgraded, raising our borrowing costs. The 'pain' these idiots complain about hasn't even begun.

[John Jorsett]

"We have not made any specific decisions yet, but I think at the very least we are still looking at holding the growth of spending steady," Yee said.

Not, "cut spending." Not, "no growth in spending." We're just going to "hold growth of spending steady." Considering that spending grew 36% in 4 years, that's not exactly a comfort, is it? The train wreck that is the California budget continues.

[Ernest_at_the_Beach]

See this :

(Massachusetts)House reinstates $1.14 Billion tax increase.